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| Carnival for Muskovites; Lent for the rest of us |
First I have to confess that it feels a bit odd to review themes in the relatively mundane world of ACA administration and performance in a year that in the 11th month shaped up as an annus horribilis, with Trump’s reelection. On the healthcare front, the parade of cranks and perverse contrarians nominated by Trump threaten disaster at the CDC, NIH and FDA, while a Republican Congress readies a fresh run at the kind of catastrophic spending cuts that Republicans have fantasized about for decades. My hope is that with the smallest possible majority in the House, Republicans will fail or (to be fair to some chunk of their members) balk at major cuts to Medicaid or major legislative changes to the ACA. I even retain a sliver of hope that the boosts to ACA subsidies enacted in the American Rescue Plan Act, currently funded only through 2025, will be extended, at least in part. But I expect deep wounds to our institutions, in healthcare as everywhere. If damage stops short of outright catastrophe, we can count ourselves lucky.
One major thread in this year’s posting is the concentration of enrollment growth in the ACA marketplace in the post-ARPA years in states that refused to enact the ACA Medicaid expansion. This is not primarily a result of enrollment fraud, as alleged by the Project 2025-adjacent Paragon Institute under the leadership of Trumpist health economist Brian Blase, who is laying the groundwork for major cuts to public health insurance programs. In July I countered Blase’s charges at some length, while acknowledging valid points — e.g. the obvious need for a crackdown on broker fraud (a crackdown begun this summer, per below) and for some regulatory tightening (eliminating the ability of low-income enrollees to make monthly enrollment changes, an option exploited by unscrupulous brokers). Marketplace enrollment growth in OEP 2024 and, it’s now emerging, in 2025, was driven in large part by the Medicaid unwinding (a fact that Blase acknowledges but casts in a nefarious light).
As we brace for Trump 2.0, I hope my 3-part review of Trump 1.0’s administration of the ACA marketplace (along with a more recent parsing of Trump and Vance’s claims that Trump “strengthened” the ACA) may prove useful. Surprise: it wasn’t all bad — although it seems that Trump’s “heroism was quite inadvertent” (to paraphrase Woody Allen’s antagonist in Love and Death) on the main count (see: silver loading).
A rising tide of broker fraud in the ACA marketplace burst into view this year, via excellent reporting from KFFs Julie Appleby, underpinned by a lawsuit alleging fraud perpetrated by a major EDE web-broker and a pair of agencies deploying dozens of downline agencies. In several posts, I delved into the evidence and CMS’s response. Posts included a look at gray-area fraud and sloppy agency practice; a close look at the expanded allegations in an amended complaint from the plaintiffs alleging large-scale fraud; and red flags in a past CMS celebration of rapidly expanding broker participation in the marketplace.
The Biden years were a heady time for ACA watchers — though always shadowed by the threat of a Trump resurgence. Medicaid enrollment, including among those made eligible by the ACA expansion, swelled, a a three-year pandemic-induced moratorium on disenrollment played out — then shrank back in an “unwinding” of that moratorium kicked off in May 2023, leaving a net increase since the eve of the pandemic of about 11%, or 8 million, as of August 2024. The enhanced marketplace premium subsidies implemented with ARPA in March 2021 triggered a near-doubling of enrollment, from 12 million in OEP 2021 to a likely 24-odd million by the end of OEP 2025. The unemployment rate has hovered near 4% for the entirety of Biden’s term, a full employment level not sustained since the 1960s. Not surprisingly, the uninsured rate dropped to an all-time low of 7.9% nationally in 2023 (the last year tracked).
All that enrollment growth is under threat from a new Trump administration and majority-Republican Congress. Medicaid enrollment will be cut by, at the very least, work requirements being readied now in red states. The Republican Congress will try for truly catastrophic further cuts — e.g., reducing the federal match rate for the ACA expansion population; further reducing match rates for “rich” states; and imposing block grant funding or per capita caps on federal Medicaid funding. In the ACA marketplace, the odds are against renewal of the ARPA subsidy boosts. While there is allegedly little appetite among House Republicans to allow the subsidies to revert to pre-ARPA levels, it’s hard to imagine them taking positive action to extend subsidies scheduled to sunset in 2026. Perhaps Democrats will manage to slip extensions into must-past omnibus spending bills.
As Republicans at least gesture toward major cuts, progressives will dust off and update their analyses of the major cuts threatened in 2017 — as the Center for Budget and Policy Priorities, Georgetown’s Center on Health Insurance Reforms and Center for Children and Families, the Center for American Progress, and Charles Gaba are already doing. It will be a weary rematch. As in 2017, fending off catastrophic defunding and major repeal will be the best outcome to be hoped for. Perhaps the more intense danger is on the public health/disease management front, as Trump appointees gear up to disarm our already-inadequate defenses before the next pandemic and roll back decades of progress in vaccination and infectious disease control. Happy New Year!
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